Whether it’s a car, truck, or motorcycle—no motorized vehicle may be driven without liability insurance. Liability coverage is essential to ensure that victims of an accident are adequately compensated.

Coverage includes:

• All damages you cause to others while using your vehicle, including lost earnings, pain and suffering, or lifelong pension payments in case of permanent injury

• Costs for towing, repairs, or replacement of the other party’s vehicle

• Rental car costs for the injured party during repairs, within certain limits

KFZ liability insurance also covers:

• Towing and repair costs or replacement of the other party’s vehicle

• Rental car expenses for the injured party during the repair period, within certain limits

High coverage amounts in case of damage
Liability insurance reviews whether the accident victim’s claims are justified and legally defends against unjustified or excessive demands.

Legal minimum coverage requirements:

• €7.5 million per person for personal injury

• €1.12 million for property damage

• €50,000 for financial losses

In practice, insurers typically offer much higher coverage limits, ensuring extensive financial protection in the event of a serious accident.

Partial coverage
Partial car insurance reimburses damage to your own vehicle caused by:

• Theft

• Fire

• Severe weather

• Collisions with animals

• Broken glass

It also covers factory-installed accessories in case of theft or destruction, with details specified in the policy terms. Some insurers even cover increasingly common marten bite damage.

Tip: Opting for a partial coverage plan with a deductible can help reduce your premium.

Comprehensive coverage
Comprehensive insurance covers all damage to your vehicle, including accidents you cause yourself. Vandalism, such as scratched paint or dented doors, is also included.

If you claim comprehensive insurance (beyond partial coverage), your policy may be downgraded, resulting in a higher premium the following year. Like partial coverage, deductibles are common. Due to the higher premium, comprehensive insurance is especially worthwhile for new vehicles.

Vehicle classes in liability, partial, and comprehensive coverage
Car insurance premiums are initially calculated based on the type of vehicle. Each vehicle is assigned a type class for liability insurance and two additional type classes for partial and comprehensive coverage.

These type classes reflect the historical claims experience of different vehicles. The lower the type class of your car, the lower your premium.

Influence of location on premiums
Premiums also depend on your place of residence. Regional classes are based on the claims history in different German registration districts. For comprehensive coverage, local factors such as flood risk, hail, or theft frequency are also considered.

Adjustment of regional classes
Reclassification into cheaper or more expensive regional classes occurs every October 1st. However, about two-thirds of all policies remain unaffected each year.

New drivers pay higher premiums in liability and comprehensive insurance than experienced drivers with a long record of accident-free driving. If you do not make claims over time, your premium decreases significantly. Long-term accident-free drivers may pay as little as 20% of the standard premium.

Paying for small damages yourself
No-claims classes and downgrade rules vary between insurers. Downgrades can often be avoided by paying for minor damages out of pocket, as the discount depends on the number of claims, not the claim amount.

Your insurer can advise whether it is worthwhile to cover a minor damage yourself. Some insurers also offer “discount savers” (Rabattretter), meaning your first accident does not automatically result in a downgrade to a higher premium class.

Lower premiums for a second car
New drivers often pay up to 300% more in liability insurance due to higher accident risk. There are ways to reduce costs:

• Register the car as a second vehicle under your parents’ policy. This allows you to start with a much lower premium. Over time, the accrued discount can be transferred to your own policy.

• Many insurers offer lower entry rates if a family member already has a car insured with the same company.

• Some insurers also give discounts to new drivers who previously insured a moped or small motorcycle.

Use seasonal license plates
Convertible owners can save by using a seasonal license plate, paying insurance only for the months the vehicle is registered.

• If your car is used more than six months a year, your no-claims discount continues to grow.

• Vehicle tax is suspended during inactive months.

• If you deregister in autumn and re-register within 18 months, most insurers preserve the no-claims discount through a contributory-free “rest insurance” period.